Which one of the following leases may include a renewal option?
A) A sale-leaseback arrangement
B) A direct lease
C) An operating lease
D) A leveraged lease

Question

Quizplus · Accepted Answer

An operating lease may include a renewal option, which allows the lessee to extend the lease for an additional period at the end of the original lease term. This option provides the lessee with flexibility and the ability to adjust to changing business needs. Sale-leaseback arrangements involve the sale of an asset to a lessor who then leases it back to the seller, and typically do not include renewal options. Direct leases and leveraged leases may or may not include renewal options, but this is not a defining characteristic of these types of leases.

Which One of the Following Leases May Include a Renewal